Taxes. Uggghh. But it’s part of life that is certain, and that you have to deal with or else. This episode of the Amazing Seller is perhaps long overdue because it walks us through the details of business taxes, business structures, and the decisions you need to make in order to remain compliant with the U.S. laws regarding income and expenses in your business. For that important topic Scott asked his new CPA, Josh Bauerle to come onto the show to share from his expertise about all of these issues and a whole lot more. You’re going to get great, professional advice that can save you thousands – yes, THOUSANDS of dollars if you do it right. Be sure to listen so you can get all the details.
What are the differences between an accountant and a CPA, and how do I know if I should be using a CPA?
Most of us don’t know the answers to these questions, and many of us don’t need to know because our businesses are still on the small side. But once your business begins generating profits of $50K or more per year, you’re going to need to understand these questions and make sure you’re doing what’s best for you and your business. An accountant is someone who simply keeps accurate record of what comes in and what goes out. A CPA has gone through specified training and has specialized knowledge on tax laws and much more. Listen to Josh Bauerle’s explanation of what he does as a CPA and how businesses can benefit from his kind of services, on this episode of the Amazing Seller.
Sole Proprietor? C-Corporation? S-Corporation? LLC?
There are 4 basic kinds of business entities that you could form your business as, but how do you know which is right for you? Today’s guest, Josh Bauerle, is a CPA who says that much of the decision depends on the size of your business and your entity decision may change as your business grows. On this episode Josh walks through every one of the options in details and tells you the pros and cons so that you can make an informed decision. He’s also got a very strong opinion about the best one and tells you why he feels so strongly about it. You can hear all of that by listening to this episode of the podcast.
When do I need to invest in a payroll company?
Josh Bauerle’s experience as a CPA has given him the opportunity to observe how many businesses approach this question. And in his experience he’s come to some pretty firm conclusions about the answer. He believes that given the small expense that payroll companies are nowadays (you can find one for $30 a month, online), every business, especially LLC and S-corps should invest in the service to make sure everything is being handled correctly. It’s one of the many things you’ll hear on this episode that could not only save you money, but also keep you out of trouble with the IRS. Take the time to listen to this long-overdue episode!
What documents do I need to keep?
Business expenses do need to be documented, should the IRS ask to see the proof of the expense. Since that’s the case, how should you be organizing and keeping those records? The main thing is to keep a list of expenses and income, categorized so that you can know what you’ve spent on what. Today’s guest, CPA Josh Bauerle, suggests that you keep those records regularly, and keep all receipts in a shoe box or some other catch-all system so you can produce them if needed. That way you have everything you need, if and when you need it, and your accountant will be able to do a good job with the records you provide.
Hang around to listen tot his great episode. It’s practical and helpful!
OUTLINE OF THIS EPISODE OF THE AMAZING SELLER
- [0:05] Another welcome to the podcast and your introduction to this episode!
- [2:09] Getting to know today’s guest, Josh Bauerle.
- [4:16] How Josh got connected with John Lee Dumas.
- [6:23] The differences between an accountant and CPA.
- [8:39] How to know when you need a CPA.
- [9:56] What to look for in a local CPA and how to find one.
- [10:57] Looking at the varying business entities you could form.
- [12:35] Does a LLC have to have an EIN number?
- [13:37] What is a C-corporation and why would you want to form one?
- [14:22] What is an S-corporation and why would you want to form one?
- [17:00] How to determine a “reasonable” salary within an S-corp.
- [21:32] When would a business owner begin considering an S-corp?
- [23:55] How long does it take to make a switch from LLC to S-corp?
- [25:52] Tax deductions that most entrepreneurs should consider.
- [28:51] How the payroll company works in an S-corp.
- [29:50] What’s a good rule of thumb to avoid audits.
- [32:12] Things to consider for documentation and bookkeeping.
- [35:04] Last bits of advice from Josh.
- [36:50] Scott’s recap of the episode with Josh.
- [38:00] Scott’s shout-out to the TAS Facebook community, and how you can be a part of it.
LINKS MENTIONED IN THIS EPISODE
Josh’s website: www.CPAonFire.com
www.TheAmazingSeller.com/FB – the TAS Facebook Community
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